HSBC Holdings plc says the sale of its Canadian division to Royal Bank of Canada is going to take longer than first expected, but that the deal remains a key priority.
London-based HSBC says it now expects to complete the $13.5-billion transaction in the first quarter of 2024, rather than late this year as it guided when it announced the deal last November.
The bank says the later close is to ensure a smooth transition, while several other recent bank deals have taken longer than expected amid heightened regulatory scrutiny, including TD’s still pending takeover of First Horizon.
The Competition Bureau on Tuesday put out a call for input from the public on the RBC deal, seeking information that would help it assess potential impacts on competition from the deal.
“The bureau is investigating whether the proposed acquisition is likely to result in a substantial lessening or prevention of competition for services provided by the companies, including personal and business financial services across Canada,” it said in a release.
Among other things, the regulator is reviewing the impact on the competitive landscape in various market segments, including the retail investment business, investment counselling and various retail banking businesses, such as consumer lending, mortgages and ordinary banking services.
The review will consider the potential impact of the proposed acquisition on price, selection and quality of products and services in these various businesses, it said. The deadline for submitting feedback is June 1.
Both the Competition Bureau and the Office of the Superintendent of Financial Institutions are reviewing the transaction, which requires approval from the finance minister.
HSBC Bank Canada says it had a record profit of $309 million before income tax expense in the first quarter, up $17 million from the same quarter last year, while its total assets were $123.3 billion at quarter end.